Sport Facilities, A New Arena In Edmonton, And The Opportunities For Development and A City's ...

47 Pages·2008·0.64 MB·English

Sport Facilities, A New Arena In Edmonton, And The
Opportunities For Development and A City’s Image:

Lessons From Successful Experiences

Mark S. Rosentraub, Ph. D.

The contributions and help of Professor Dan Mason of the University of Alberta is
gratefully acknowledged and very much appreciated.

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Mark S. Rosentraub, Ph.D. 

Dr. Rosentraub has been studying and writing about the economics of professional 
sports and the link between sports and urban development for more than 30 years.  
  He has written or co‐authored three different books and more than 30 academic 
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articles and book chapters on different aspects of sports economics and urban 
development.  He is currently writing a fourth book dealing with cities that have 
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successfully used sports facilities as anchor developments for changing urban 
centers and city images.  
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Dr. Rosentraub’s professional work has not been limited to academic studies and 
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books.  He worked with the San Diego Padres and the City of San Diego in designing 
r the Ballpark District plan that has brought more than $2 billion in real estate 
development to downtown San Diego.  He has also advised two different mayors of 
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Indianapolis across more than a decade on their sports strategy that has successfully 
led to the redevelopment of that city’s downtown area and overhauled its image.   
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i Dr. Rosentraub has also helped other sports organizations such as the Indianapolis 
B Motor Speedway and the arts and cultural organizations consider how their assets 
and activities can advance urban redevelopment and a city’s image.  In the 1990s he 
helped the Mayor’s office of Los Angeles with some of its downtown redevelopment 
work involving the Staples Center and has helped other communities from Dallas to 
Brooklyn and to Green Bay.  He has visited Edmonton twice before to discuss 
redevelopment possibilities.  Dr. Rosentraub has testified before congressional and 
state legislative committees focused on urban redevelopment and he has worked 
with cities across North America to develop plans for rebuilding cities.  

In 2003 the Cuyahoga County Commissioners appointed Dr. Rosentraub to the 
board of Gateway.  “Gateway” is the public agency responsible for Jacobs Field, 
home to the Cleveland Indians baseball team, and Quicken Arena, home to the 
Cleveland Cavaliers basketball team.  He helped rewrite the lease for both teams that 
avoided financial problems for Cleveland and Cuyahoga County. 

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Introduction

Across the past four decades state, provincial, and local governments across North
American have invested billions of dollars to build and maintain arenas, ballparks, and
stadiums for teams from the four major sports leagues. The first set of investments was
for facilities frequently surrounded by vast open parking areas making them convenient
for vehicle access for fans from suburban areas. These facilities were often located far
from a region’s urban center. However, when these facilities were built scant attention
was given to strategies to include these large investments and physical facilities into
plans for more comprehensive economic development or for the enhancement of the
image of a region. This was the “build it and they will come era,” where community
leaders thought (or hoped) that the mere presence of a sports facility would change a
city’s image and induce economic development. Independent assessments of the benefits
from these facilities, predictably found no economic development enhancements, and no
real shifts in a city image. This meant that public expenditures for a sports facility or for
the infrastructure required when teams paid for the arena, ballpark, of stadium became
little more than subsidies which substantially increased the value of teams, enhanced
profits levels, and indirectly helped to increase players’ salaries.
The city of Indianapolis, Indiana took a different path and used a series of sports
facilities to construct an entirely different image for itself, and by the 1990s several
communities understood that if a sports facility was to be an asset for a community’s
economic and community development and image, these large facilities had to be part of
an integrated strategic plan. These cities charted a new course developing unique
public/private partnerships and plans that insured that new facilities would change the
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location of economic activity within the city and region and the broader image of a city or
its downtown area. These community leaders recognized that an arena represents a 30-
year planning decision relative to the use of land and resources in an urban center. If
used as an anchor for an overall strategy these facilities could change the location of
economic activity, support development, and change the image of an entire city or an
under developed part of a metropolitan area.
Edmonton’s community leaders and its National Hockey League (NHL)
franchise, the Oilers, are now presented with an opportunity similar to ones that existed
for Indianapolis, San Diego, Los Angeles, Columbus (Ohio), and Washington, DC.
Those communities hosted franchises that needed or wanted new facilities, and each
capitalized on the opportunity to create strategic plans that satisfied the team’s financial
goals while also enhancing a city’s image and certain critical economic and community
goals. The following summary is designed to help Edmonton’s community leaders, the
Oilers, and other key stakeholders understand how unique public/private partnerships in
other cities might create some important ideas to help Edmonton and the Oilers achieve a
unique redefinition of the city and its downtown area that could have lasting economic
and community development effects while also insuring the team’s future financial
stability.
The summary is divided into three sections. First, the logic or theory that
underscores why cities and teams should capitalize on the unique role of sports for
development and the enhancement of a region’s identity is outlined. That is followed by
discussions of successful public/private partnerships for new sports facilities that
succeeded in changing development patterns while also enhancing the image of a city or
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its downtown area. Each of these case studies also describes the returns to the public
sector from its investment of tax revenues. The last part of the summary identifies some
possible development options that could be available to Edmonton and the Oilers to
change the city’s image, enhance downtown development, and advance the team’s
financial stability.

Theory Before Practice: Why Edmonton and the Oilers Should Care
About Sports and Entertainment for the Region’s Future

Suggesting that cities should develop public/private partnerships to use sports
facilities to advance economic development has generated important criticism. Some
believe that when cities include a focus on sports or entertainment as part of their public
policy agenda that the purpose of government is fundamentally realigned. Those critical
of an emphasis on sports argue that local governments’ primary responsibilities for
economic and image development should be limited to:
(1) Insuring the availability of clean water and other public utilities,
(2) Protecting the public’s health,
(3) Building and operating quality schools,
(4) Maintaining roads and other forms of transportation,
(5) Insuring the public’s safety from crime and improperly built and maintained
buildings, and;
(6) Enhancing the quality of life through the construction and support of public
parks, libraries, and selected other amenities.
Insuring the success and presence of professional sports teams is not on this list of these
responsibilities (Eisinger, 2000).
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How and why did professional sports become part of the public agenda?
In the 1960s and 1970s with the explosive growth of suburban areas across North
America and the decentralization of economic activity away from the center of most
regions, maintaining a vibrant downtown became a greater challenge. As residents and
businesses found they could locate in areas distant from a region’s core a decentralized
structure emerged which frequently made it more difficult for many regions to create and
sustain a distinct image and a sense of centrality from any core area. In some instances
the decentralization also contributed to excessive land use patterns that produced
unnecessary sprawl and the loss of open space. Suburban lifestyles, office parks, and
shopping malls provided a level of convenience and in many instances reduced land
development, housing, and office costs. But the ensuing sprawl left many areas without a
concentrated critical mass of activity that could establish a region’s image through central
meeting areas with unique architecture that also offered unique social and cultural
experiences at theatres, museums, and at facilities that hosted sporting events. These are
the elements that often distinguish cities from one another. Toronto, Montreal,
Vancouver, New York, Chicago, Seattle, and San Francisco each have suburban areas,
but they insured that downtown areas remained vital through the provision of unique
experiences that could not be replicated in suburban malls. After decades of growth,
cities like San Diego, Phoenix, Dallas, and Los Angeles began to wonder what their
image was and how it could be sustained without a vibrant core. These areas, similar to
slower-growth regions in America’s Midwest, began to focus on strategies to build or
rebuild downtown areas to establish an identity and to advance the region’s overall
development. This process was even more critical for cities reliant on traditional
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industries or lacking physical features that made them among the most desirable places to
live and work.
The focus on downtown development – even in fast growth areas – was also tied
to a new competition for human capital and business location. For many communities it
was becoming increasingly clear that in the competition for the human capital that will
drive the 21st century economy vibrant urban cores and downtown areas are vital assets.
The companies that will define the future growth of every nation were choosing to locate
where the best and brightest workers wanted to live, and increasingly this is in or near the
downtown areas of urban centers that have made the investments to make their core areas
vital and unique. The very human capital that drives the future of the 21st economy,
described by some as “the creative class (Florida, 2002)” or simply “idea generators”
have clearly “voted with their feet (Tiebout, 1956)” and their choice is to leave in cities
with vibrant downtown areas. Why?
The human capital needed to advance the service economy is attracted by and to
what Pine and Gilmore (1999) described as the “experience economy.” With the
emphasis on video and audio, the worlds of work, education, and entertainment have
become wedded to experiences. As a new middle class emerged with higher levels of
disposable income but increasingly less bundles of time in which to enjoy experiences,
there exists a demand for cities to insure that within their borders are the mix of
experiences that the creative class or idea-generating workers demand. A profound shift
in the battle for economic dominance has taken place and the regions and cities that offer
opportunities of unique experiences are the areas corporations seek for their locations.
Corporations choose these locations, as they are the one where the most productive and
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dynamic workers want to live. Corporations can insure their success by having access to
a pool of talent, and if that talent wants to live in areas with unique experiences and
vibrant downtown areas, that is where future development and economic expansion will
occur. Cities that offer the full range of these experiences concentrated in a downtown
areas are, simply put, more desirable. Businesses are worried about being to attract and
retain the best talent sought locations that had the highest quality of life, the best mix of
amenities, and a set of large-scale and neighborhood-based entertainment experiences
that the “creative class (Florida, 2002)” or “idea generators” want when they chose places
to live. People still live where the jobs are, but companies that created those jobs wanted
to locate where they are confident there will exist the right mix of amenities that would
appeal to the idea generators they need to advance their business. As a result, leading
corporations choose areas with vibrant downtowns for their headquarters.
Professional sports remain an integral part of quality of life and the production of
these unique experiences. Communities must make public safety and education their
highest priorities and can have a very high quality of life without being home to a
professional sports team. Yet, virtually all of the cities on the myriad of “best places to
live lists” are located close to the facilities that that are home to professional sports teams.
The real opportunity for a city’s leadership is not to choose between sports and public
safety or education, but to understand how some communities were able to use sports
facilities to advance the quality of life, community development, and their image without
minimizing their responsibilities for other public services. As Eisinger observed,
“Few people would argue with the proposition that facilities that bring
high or even mass culture, sports, and recreational opportunities to a city
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may enhance the quality of life. Stadiums and performing arts centers and
festival malls help to transform places that would otherwise simply be
markets or dormitories …. The issue, then, is not whether to spend public
money [for sports or entertainment facilities]; rather the issue is a matter
of balance and proportionality (2001: 330-331).”

Theory Before Practice: Is Sports A City’s Fool’s Gold?
The ability of sports to anchor urban development strategies that can change a
city’s image and refocus economic activity lies in its timeless importance. While some
disdain the importance of sports or simply ignore it, sports have been and remain an
integral part of most if not all societies. Its history as a central part of societies and
civilizations spans thousands of years. Some might think the mass popularity of sports is
a product of the modern media age, ESPN, and fantasy leagues. Sports, however, had a
similar level of importance for past civilizations that probably matches the zeal among
those with fantasy teams and those willing to pay premium prices for the best seats to
important games or championship contests. To be sure, at no other time in history have
athletes earned the financial rewards now available, and never before have prices for
tickets to some events been so expensive as demand for experiences continues to exceed
supply. Some professional sports teams have become so popular that their market value
exceeds a billion dollars. That too is a new phenomenon, but what is not new is people’s
focus on and interest is sports.
For example, ancient Rome used sports to showcase its technological
achievements as well as its wealth through the building of a facility replete with luxury
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seating, the ability to host both aquatic and land-based spectacles, and room for 50,000
spectators. The Colosseum, built more than 1,900 years ago, was larger in terms of
spectator capacity than the home fields of every MLB team except the New York
Yankees and the Los Angeles Dodgers.1 Its incorporation of luxury seating with colorful
cloth coverings to protect the elite from the sweltering sun was said to be part of the
inspiration for the building of America’s first indoor stadium, Houston’s Astrodome. It
was not unusual for crowds of 50,000 to attend events at the Colosseum.
For Western societies, written records from as early as 776 BCE document the
importance placed on sport; those records are the earliest reports of the competition
known as the Olympics. Some believe, however, that the Olympic competitions might
have been held even earlier. Regardless, the games continued for more than six centuries
before being abolished by the Romans in 393 CE. The Roman contribution to sport –
sometimes credited with making sports a profession – begins in 310 BCE with the onset
of gladiatorial games and the establishment of training centers for combatants. By 183
BCE major gladiatorial contests involved as many as 60 pairs of fighters with far larger
spectacles to follow in later years. The apex of sports in the Roman Empire involved the
building of the Colosseum and the staging of events involving boats, animals, and
gladiators. Beyond the brutality of gladiatorial games and the construction of facilities
throughout the empire to underscore the Empire’s prowess, the Romans also used sport
facilities as a central component of the design of cities from Rome through the Decapolis
(the 10 cities on the Eastern edge of the empire) to Pula (Croatia). Roman cities had

1 While Shea Stadium, home to the New York Mets from 1964 to 2008 had more seats than
Rome’s Colosseum, their new home, Citi Field, has a planned seating capacity of 45,000.
Toronto’s Rogers Centre seats 46,105 for baseball.
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